Euro zone inflation dropped to a three-year low of 2.2% in August, flash figures from statistics agency Eurostat showed Friday, boosting expectations for a September rate cut from the European Central Bank.
The core rate — excluding the more volatile components of energy, food, alcohol and tobacco — fell to 2.8% in August from 2.9% in July, also matching a Reuters poll.
The euro nudged 0.04% higher against the U.S. dollar to $1.1083 as investors gear up from a September rate cut from the Federal Reserve in its first step toward monetary easing in the current cycle.
It come after price rises in Germany, the euro area's biggest economy, cooled more than expected to 2% for the month, on a euro zone harmonized basis.
Economists at ING expect euro zone core inflation to remain stubbornly above 2.5% for the rest of the year amid stickiness in goods and services.
Organizations:
Eiffel, Paris, European Central Bank, Reuters, U.S, Federal Reserve, ING, Markets, ECB
Locations:
Paris, Germany
![Media-Cldnry.S-Nbcnews.Com Image Upload Newscms Dennis-Romero-Circle-Byline-Template.Jpg](/find/mix/0?q="Media-Cldnry.S-Nbcnews.Com Image Upload Newscms Dennis-Romero-Circle-Byline-Template.Jpg"){kind=link}